NEW YORK CITY-AIG said Monday it has raised nearly $37 billiontoward repaying its TARP bailout under terms of its Sept. 30agreement with the Treasury Department and the Federal Reserve Bankof New York. The funds come from AIG’s sale of subsidiary AmericanLife Insurance Co. and the initial public offering of AIA GroupLtd. Both are overseas operations.
The announcement comes as AIG closes on its $16.2-billion saleof ALICO to MetLife, including $7.2 billion in cash and theremainder in MetLife securities. AIG says it expects to use thecash proceeds from the ALICO and AIA transactions to repay thecredit facility extended to AIG by the New York Fed and to makepayments on other interests owned by the government. The MetLifesecurities will be sold over time to provide additional funds torepay the federal government.
On the AIA IPO, gross proceeds were $17.8 billion, increased to$20.5 billion through the exercise of the over-allotment operation,AIG says. The ALICO and AIA transactions “will generate sufficientcash to allow AIG to pay off the FRBNY credit facility, marking amajor milestone in our commitment to repay the American taxpayers,”president and CEO Robert Benmosche says in a statement.
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